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Posted at 08:30 AM ET, 07/12/2012

Small business branding lessons from Zappos

In this highly competitive and transparent world, Zappos has become a shining example of how corporate culture can be leveraged into stellar financial results. Following in the footsteps of Disney, Starbucks and others, Zappos’s particular cultural focus — that of delivering happiness — has already delivered a billion dollars of success.


For Zappos, branding boils down to one word: culture.
On a recent trip to Las Vegas, I had the great opportunity to tour its headquarters, followed by a meeting with Robert Richman, then cultural strategist heading up Zappos Insights who has since left the company to pursue his own projects. The visit left me inspired, motivated — and, yes, happy.

The relationship between culture and brand has completely fascinated me since a three-year stint at Disney World early in my career. There I experienced first-hand the moments of greatness and ongoing sense of fulfillment that can be created from a dedicated team with a strong culture that collaborate to create a great brand. The Zappos insight on this topic is fresh, a perspective the company is happy to share with anyone who wants to know about it.

Here’s are the lessons I found most pertinent for small businesses.

The all-important role of culture

In Zapposland, culture is everything. Company officials will tell you it drives everything that’s going on at the company at every level. Here’s how it goes: Culture is programmed by values, values drive behavior, behaviors drive actions, and actions produce results.

So, if you want to change results, you focus on culture.

As Richman said, “Typically people focus on results but they don’t realize the actions are what drives the results. If you’re too focused on the results it’s like playing a whole sports game while looking at the score board.”

He also says you can gain short-term wins by cutting costs alone, but that won’t help you thrive. (As seen in Howard Schultz’s need to return to Starbucks when culture lost its top priority position.) Richman said it’s easier to see budget cuts than it is to see culture so budget cuts can be a more obvious path to improvement. However, you will learn that results from budget cuts can become something like “experiencing hits from a crack pipe — powerful but the high is short-lived.”

What is culture anyway?

Richman said that, ultimately, the culture is experienced as a feeling. It’s how it feels when you walk through the building, take action and interact with others. That’s what people respond to and how they learn the organization’s code of behavior.

But feelings are hard to manage. So Zappos breaks down the culture into its component values. What drives culture is recognizing what you value and what you don’t. He recommends that you define what you value and what you don’t. Hire for it. Train for it, and make sure it’s in every part of your business. That’s what drives results through culture.

How Zappos defines brand

This was very interesting to a branding person like me. I’ve long been on the forefront of espousing that great brands need to be supported by a great brand culture. But Zappos goes even further. The company boldly claims that internal culture and your brand are the same. Here’s how they see that:

Everything the market experiences about you is a result of your culture.

The marketplace defines your brand by its experience. Continued experiences translate to the promise of a consistent experience.

Therefore, Zappos defines your brand as a “lagging indicator of culture,” as it takes six to 12 months for the marketplace to experience your culture changes.

Happiness as a core goal

Zappos is a seller of products that has built its reputation on its service. Its version of “WOW service” is focused completely on making people happy. Its secret sauce is treating people like people and appreciating them for what they do. As simple as it sounds, isn’t that what we’re all looking for?

Zappos’s key is that it has mastered connecting happy people with performance indicators. Years of thinking about, generating ideas and experimenting with culture have led to processes and approaches that achieve that.

Think about it. Don’t we all do our best work when we’re happy? Aren’t we happiest when we can feel appreciated, connected with others and have the chance to contribute to something outside ourselves?

“The trick is to connect happy people with performance indicators,” Richman said. “If people are enjoying what they’re doing and making a contribution, everything goes spectacularly.”

He adds that prolonged stress — often caused by excessive focus on results — will ultimately block creativity and productivity, and destroy your culture.

How can you get started to develop your own culture?

Richman said that you can create your own path of culture management. The first step on that path is having an experience that proves to you that managing culture is the road to long-term success. That experience can come through reading a book or you can take a Zappos tour, visit Disney World or put yourself in any environment where a strong culture exists.

The next step is commitment. Richman said commitment is the biggest defining factor determining whether a culture program will work. If you’re not committed, you can reap short-term gains but will fall short in developing culture.

Susan Waldman is co-founder and vice president of strategic services for ZilYen, a marketing firm based in Washington.

By  |  08:30 AM ET, 07/12/2012

 
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